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This is related to international finance. Please help me to do this. fQuestion 10 Long position of a contract means that the holder of the
This is related to international finance. Please help me to do this.
\fQuestion 10 Long position of a contract means that the holder of the position expects profits if the price of the future contract goes up. 62,500*1.4= $87,500 The answer is TRUE. If the future contract price increases, the holder will obtain profits. Question 12 The payment at time of delivery will be euro denominated. Since the FX rate will be euro per dollar the transaction will create a negative exposure to the euro. Question 7 Inflation in the UK is expected to be on the rise and will therefore not reach its target of 2% for the coming years. Inflation will obviously cause the pound to fall, however, the comment should result in the decline of bonds as investors would expect a decline in their expected returns. On the contrary the U.K government bond rises as the government increases the risk premium to investors to cover for inflationStep by Step Solution
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